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Tax Court Announces New Case Management System to Go Live Before New Year’s

We previously reported on the US Tax Court's (Tax Court) announcement that it was changing its case management system, DAWSON (Docket Access Within a Secure Online Network). This morning, the Tax Court issued a press release confirming the launch of DAWSON on December 28, 2020. Temporary credentials for taxpayers and practitioners already registered for electronic access will be sent no later than December 28, 2020, and will be valid for seven days. Expanded guidance on using DAWSON, including FAQs, will be available shortly on the Tax Court's website.

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2020’s Key Tax Controversy Developments

In the face of the pandemic and all the challenges that came with 2020, tax controversy marched on. In this article, we explore several important cases, including one of the most closely watched Supreme Court cases, CIC Services LLC v. Internal Revenue Service, which raises important questions regarding the scope of the Anti-Injunction Act and impacts the ability of taxpayers to engage in preenforcement challenges to regulations. We also look into the latest updates in the transfer pricing area, changes to the Compliance Assurance Process, what to expect during the audit of a campaign issue and more. Read the full article.

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The End of an Era—Senior Judge Robert P. Ruwe Retires from US Tax Court

The US Tax Court (Tax Court) recently announced that Senior Judge Robert P. Ruwe has fully retired as of November 25, 2020, after more than 33 years on the bench. Judge Ruwe graduated from Xavier University and was first in his class in law school at the Salmon P. Chase College of Law. He then joined the Internal Revenue Service (IRS), where he held various positions, including Director, Tax Litigation Division. Judge Ruwe was appointed to the Tax Court in 1987 and, after his 15-year term expired, he served as a senior judge. In 2012, Judge Ruwe received the J. Edgar Murdock Award for his distinguished service to the Tax Court. At the time of his retirement, Judge Ruwe had authored hundreds of opinions, including many noteworthy concurrences and dissents. Some memorable ones include: (i) Rauenhorst v. Commissioner, 119 TC 157 (2002) (holding that the IRS was bound by its position in published guidance, and treating that position as a concession); (ii)...

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Tax Court to Update Case Management System

The US Tax Court (Tax Court) recently announced upcoming changes to its case management system. DAWSON (Docket Access Within a Secure Online Network), named after former Tax Court Judge Howard A. Dawson, Jr., who passed away in 2016, is expected to be active by the end of 2020. To facilitate the transition to DAWSON, the Tax Court's current e-filing system will become inaccessible and all electronic files will become read-only beginning at 5:00 pm EST on November 20, 2020. Cases will remain electronically viewable, but no documents may be e-filed during this time. Importantly, no orders or opinions are anticipated to be issued during the transition. Due to the lack of e-filing during the transition, Tax Court judges are trying to avoid setting deadlines that fall within this period. If a filing is required, it must be done the old-fashioned way on paper and by mail, with a proper certificate demonstrating service on the opposing party. Notable improvements in...

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The Legal Effect of IRS Pronouncements on Virtual Currency

Given limited guidance by US tax authorities regarding taxation of virtual currency activities, taxpayers with such holdings may find themselves in uncharted territory as to whether to take positions that are contrary to IRS pronouncements. This article explores relevant notices, rulings and FAQs, and reviews the types of deference that courts tend to put on different types of IRS interpretations and guidance. Access the full article here.

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Weekly IRS Roundup June 22 – June 26, 2020

Presented below is our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of June 22 – June 26, 2020. Additionally, for continuing updates on the tax impact of COVID-19, please visit our resource page here. June 24, 2020: The IRS issued final regulations permitting a regulated investment company (RIC) that receives qualified real estate investment trust (REIT) dividends to report dividends the RIC pays to its shareholders as section 199A dividends. June 25, 2020: The IRS Office of Chief Counsel announced a limited settlement offer to certain taxpayers with pending docketed US Tax Court cases involving syndicated conservation easement transactions. The settlement offer requires a concession of the income tax benefits claimed by the taxpayer and imposes penalties. June 26, 2020: The IRS will begin to reopen Taxpayer Assistance Centers starting on June 29, 2020. In-person appointments will be available for...

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Tax Court Records Accessible Again

When the US Tax Court (Tax Court) shut down in March, the public was unable to request copies of Tax Court records. That changed effective June 1, 2020, as non-parties may now call and request copies of court records which will then be sent via email. The cost for copy requests is $0.50 per page, with a per-document cap of $3.00. The Tax Court’s press release on this subject can be found here. Practice Point: It can be extremely beneficial to taxpayers and their advisors to see arguments being made by other taxpayers and the Internal Revenue Service in cases with similar legal issues. The ability to now directly call the Tax Court to request briefs or other filings in a docketed case, and to receive such documents electronically, is significant. Moreover, the cap of $3.00 per document may provide an incentive to request documents where the price per page, without a cap, was previously financially burdensome.

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Tax Court Zooms into Remote Proceedings

On May 29, 2020, the US Tax Court (Tax Court) announced that to accommodate continuing uncertainties relating to the COVID-19 pandemic, and until further notice, all court proceedings would be conducted remotely. The Tax Court also issued Administrative Order 2020-02 regarding the conduct of remote proceedings and Administrative Order 2020-03 regarding limited entries of appearance. The Orders are effective until terminated by the Tax Court. Administrative Order 2020-02 contains sample forms, which are also available under the “Forms” tab on the Tax Court’s website, providing more information on how Tax Court proceedings will be conducted during the pandemic. The updated forms include: Notice Setting Case for Trial Standing Pretrial Order for Regular Cases Standing Pretrial Order for Small Tax Cases Pretrial Memorandum Petitioner’s (Taxpayer’s) Getting Ready for Trial Checklist The forms make clear certain requirements that are contained in the Tax Court...

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Weekly IRS Roundup April 20 – April 24, 2020

Presented below is our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of April 20 – April 24, 2020. Additionally, for continuing updates on the tax impact of COVID-19, please visit our resource page here. April 21, 2020: The US Tax Court proposed amendments to its Rules of Practice and Procedure. The proposed amendment to Rule 24 incorporates simplified procedures for the withdrawal and substitution of counsel, and clarifies limitations on counsel’s representation of a party to more closely follow the American Bar Association Model Rules of Professional Conduct. Written comments to the proposed amendments must be received by May 31, 2020. April 21, 2020: The Treasury Department and the IRS released Revenue Procedure 2020-27 to provide a waiver of the time requirements of IRC § 911(d)(1). The waiver applies to any individual who reasonably expected to meet the eligibility requirements of IRS § 911(d)(1)...

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IRS Failed to Prove Supervisory Approval For Penalty Based Upon Redacted Document

In a recent order in the The Cannon Corp. v. Commissioner, No. 12466-16, the US Tax Court (Tax Court) held that a redacted email from a revenue agent’s supervisor to the agent regarding a notice of deficiency was not sufficient to satisfy the approval requirement under Internal Revenue Code (IRC) section 6751(b) for the assertion of accuracy-related penalties. Under IRC section 6751(b), as interpreted by case law, the Internal Revenue Service (IRS) is permitted to assert penalties only if the initial determination to assert the penalty is approved in writing by the supervisor of the individual making such a determination. That provision has been litigated recently in several notable cases, for example, Chai v. Commissioner, 851 F.3d 190 (2d Cir. 2017), and Graev v. Commissioner, 149 T.C. 485 (2017). Since Graev, the Tax Court has issued a series of decisions on the requirements of IRC section 6751(b). Our recent article discussing these decisions can be found...

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